Speech by the Chief Executive
the Honourable Tung Chee Hwa
at the Ceremony to Celebrate the Establishment of
the Hong Kong Special Administrative Region of
the People's Republic of China
1 July 1997

A Future of Excellence and Prosperity for All

President Jiang
Distinguished State Leaders
Honoured Guests
Fellow Hong Kong Citizens and

Today is a momentous day for China. Today is a joyous day for all Chinese people. First of July, nineteen ninety-seven, marks the return of Hong Kong to China after a long separation. It marks the establishment of the Hong Kong Special Administrative Region of the People's Republic of China. In the midnight hours behind us, China officially resumed sovereignty over Hong Kong; the Hong Kong Special Administrative Region was sworn in by the Central People's Government. In peace and solemnity, Hong Kong opens a new chapter in its history.

As Hong Kong proudly strides into the new era with a new identity, our thoughts and remembrance go, with great reverence, to the late Mr. Deng Xiao Ping. There was a time in the early 1980's when Hong Kong people became increasingly concerned about the uncertainties surrounding 1997. Despite rapid economic growth, the mood in Hong Kong remained apprehensive due to the lack of a clear direction on the future. Mr. Deng stepped forward decisively and created a blueprint for Hong Kong after 1997, under the imaginative concept of "One Country, Two Systems" and taking into account the fundamental interests of China and the Chinese people as a whole. The concept, widely accepted by all parties concerned, resolved the uncertainties over Hong Kong's future.

Today, I am particularly pleased that Madam Zhuo Lin can be here to take part in activities to mark Hong Kong's reunification with China. We express our respect and warm welcome to Madam Zhuo Lin.

We should express our gratitude to President Jiang Zemin and the entire leadership in China. During the sometimes turbulent transitional period, they have worked tirelessly to smoothen the path leading up to the handover, lay the ground for a better Hong Kong, and ensure a smooth and successful transition. This is a remarkable achievement.

We can now move forward, on the basis of the solid foundation of past successes and under the guidance of the Basic Law, to lead Hong Kong to a new height. The Basic Law provides the constitutional framework for the Hong Kong Special Administrative Region. It has documented and institutionalized the "high degree of autonomy" conferred upon us. It clearly prescribes the social, economic and political systems in Hong Kong which are different from those in the Mainland. It reaffirms the implementation of a different system within one country. It protects the rights and lifestyle of Hong Kong people and delineates our obligations.

Hong Kong is at present the freest and the most vibrant economy in the world. Free enterprise and free trade; prudent financial management and low taxation; the rule of law, an executive-led government and an efficient civil service have been a part of our tradition. All these factors which underlie our success have been guaranteed in the Basic Law.

Leaders in China have said time and again that the prosperity and stability of Hong Kong will contribute to the modernisation of our country. Furthermore, the successful implementation of "One Country, Two Systems", "a high degree of autonomy" and "Hong Kong people administering Hong Kong" is the first step towards the ultimate re-unification of China.

Citizens of Hong Kong, this is our mission. There is before us a heavy responsibility and a long way to go.

Our country has given us a high degree of autonomy, and her full support. Now is the time for us to apply our intelligence and work arduously for a better future.

Like most people in Hong Kong, I am not a passer-by. Our home, our career, and our hope are here in Hong Kong. We have deep feelings for Hong Kong and a sense of mission to build a better Hong Kong. Today, I wish to share with you my thoughts on the future development of the economy, education, housing and care for the elderly, issues which are of great concern to the people.

Hong Kong can be proud of its achievement over the past thirty years. There is no question about this. Nevertheless, we have to be alert to the challenges which lie ahead. We face keen competition in trade and services, and our competitiveness is threatened by persistently high inflation. We have to resolve a series of social problems arising from a growing and ageing population, meet the pressing demand for more and better housing, and deal with employment dislocation due to re-structuring of the economy. All these require urgent attention and careful handling. Beneath the surface of prosperity, there are insidious threats which are taxing our courage and determination.

Our foremost task is to enhance Hong Kong's economic vitality and sustain economic growth. Only through the creation of wealth can we improve the living of the people of Hong Kong, and continue to contribute to our country. It is the responsibility of the Special Administrative Region Government to create a good business environment, plan for and train the necessary manpower, and uphold the principles of free trade, fair competition and non-interference in the market. We will strive to enhance Hong Kong's position as an international financial centre and a cosmopolitan city. We will promote the services sector and facilitate the development of value-added and high technology industries. The world is entering an information era. We must adopt positive measures to encourage investment in the information industry and infrastructure, and nurture expertise in this area. Only then can Hong Kong remain at the forefront of the new age with vigour and vibrancy.

Education is the key to the future of Hong Kong. It provides a level playing field for all, and the human resources required for further economic development. Our education system must cater for Hong Kong's needs, contribute to the country, and adopt an international outlook. It should encourage diversification and combine the strengths of the east and the west. We shall draw up a comprehensive plan to improve the quality of education, and inject sufficient resources to achieve this goal.

The thrust of our policy will be to improve primary and secondary education. To start with, we must have quality teachers and principals with a strong sense of mission. We have to raise the professional qualification of teachers. In the foreseeable future, new teachers for primary and secondary schools should all have a university degree and teacher's training. We will extend full-day schooling to all primary schools and abolish floating classes in secondary schools as soon as possible. We will raise the standard of language training; formulate a comprehensive policy on the application of information technology in education; improve the system of examinations and school management; promote diversification in the school system. We will encourage tertiary institutions to develop areas of excellence. We will further review the academic system in terms of the length of and the interface between the various stages of education, so as to ensure that our education system meets the long-term interests of Hong Kong.

We have to foster among our youngsters a sense of responsibility towards the family, the community, the country and the world; and to develop in them the strength of character, the spirit of enterprise, and the versatility to cope with vagaries in life. We will encourage our young people to have all-round development covering ethics, the intellect, the physique, social skills and aesthetics. To achieve this goal, the school, the family and the community must work together and share the responsibility.

Owning one's home is an aspiration shared by the people of Hong Kong. It is crucial for nurturing a sense of belonging and maintaining social stability. Housing cost also has a strong bearing on the economic vitality of Hong Kong. The crux of the housing problem is inadequate supply, causing prices to soar and creating opportunities for speculators.

The fact of the matter is: Hong Kong has enough land to meet our housing needs. With unfaltering determination, it should be possible to resolve the housing problem. We will draw up a ten-year housing plan : to speed up reclamation and land formation; extend the mass transit system and infrastructure development; and increase the efficiency of housing production through a comprehensive review of the existing organisation and working procedures. We will substantially increase the production of home ownership flats, actively implement the sale of public rental flats to sitting tenants, and address the needs of the "sandwich class". We will increase overall housing supply at a target of not less than 85,000 flats a year. The aim is to achieve a home ownership rate of 70% in ten years. We will also speed up urban redevelopment, clear all temporary housing areas and cottage areas, rehouse the dwellers of bedspace apartments; and reduce the average waiting time for public rental housing to three years.

Rampant speculation in the property market in recent months has seriously affected our competitiveness and people's livelihood. We will devise a range of anti-speculation measures and monitor the market closely. We will take resolute action when it becomes necessary to do so.

Our senior citizens have contributed to Hong Kong's success. They deserve respect and care from the community. The Special Administrative Region Government will develop a comprehensive policy to take care of the various needs of our senior citizens and provide them with a sense of security, a sense of belonging and a sense of worthiness. We will set up a "Commission for the Elderly" with wide community representation to formulate policies and co-ordinate the delivery of services.

We will set up the Mandatory Provident Fund Scheme as soon as possible. We will also carry out an in-depth review of the Comprehensive Social Security Assistance Scheme which aims to assist the needy among our senior citizens and improve their living. We will encourage families to live with their elderly members through adjustment to the public housing allocation policies; provide supporting services to carers of the elderly; and increase the supply of housing and residential services for senior citizens. We will also improve primary health care and strengthen services for the chronically ill. Furthermore, we will promote the physical and mental well-being of senior citizens and encourage them to do voluntary work, so that they can continue to contribute to the community.

Reunification with China opens up new opportunities for Hong Kong. Successful implementation of "One Country, Two Systems" requires us to develop a better understanding of our country, cultivate a congenial relationship with the Mainland, embrace a distinctive set of values; safeguard the rule of law; protect our freedoms; promote democracy; and establish a common long-term purpose.

The interests of Hong Kong and the Motherland are intricately linked and intertwined. Due to our long separation, there is a general lack of understanding about China among the people of Hong Kong. The reunification has created a new environment and better conditions for us to understand our country and our people, and to love our country and our people. Only then can we firmly establish our roots and make "One Country, Two Systems" a success. We must strengthen the understanding and relationship between Hong Kong and the Mainland, through mutual trust, mutual economic benefits, cultural interaction, and mutual respect for each other's way of life. We know Hong Kong and the Mainland will move forward together, hand in hand.

Every society has to have its own values to provide a common purpose and a sense of unity. Most of the people of Hong Kong are Chinese, some are not. For a long time, Hong Kong has embraced the eastern and western cultures. We will continue to encourage diversity in our society, but we must also reaffirm and respect the fine traditional Chinese values, including filial piety, love for the family, modesty and integrity, and the desire for continuous improvement. We value plurality, but discourage open confrontation; we strive for liberty but not at the expense of the rule of law; we respect minority views but also shoulder collective responsibilities. I hope these values will provide the foundation for unity in our society.

Maintaining and developing the legal system and the rule of law in Hong Kong is immensely important. We will continue to ensure that the executive, legislative and judicial branches of the Government will operate independently. We will keep up our efforts against corruption and maintain a clean society. We will ensure equality before the law and provide an attractive environment for investors and the people of Hong Kong.

We will preserve the existing freedoms and lifestyle, and ensure that the people of Hong Kong will continue to enjoy the freedoms of speech, assembly, association, the press and other freedoms guaranteed by the International Covenant on Civil and Political Rights.

Democracy is the hallmark of a new era for Hong Kong. The Special Administrative Region Government will resolutely move forward to a more democratic form of government in accordance with the provisions in the Basic Law. We will provide opportunities for every stratum of the society and legitimate political organisations, and people with different shades of opinion, to participate in the political process. The Special Administrative Region Government will adopt an open attitude and be accountable to the public.

Hong Kong has an outstanding and honest civil service. They will have a crucial role to play under "One Country, Two Systems". Together, we will serve the community and work for a better Hong Kong.

For the first time in the history of Hong Kong, we now have the opportunity to chart our own destiny. Under "One Country, Two Systems", we will move forward with conviction, prudence and determination. We will work together for a better future. Our vision of Hong Kong is --

- a society proud of its national identity and cultural heritage;

- a stable, equitable, free, democratic, compassionate society with a clear sense of direction;

- an affluent society with improved quality of life for all;

- a decent society with a level playing field and fair competition under the rule of law;

- a window for exchanges between China and the rest of the world;

- a renowned international financial, trading, transportation and communication centre;

- a world class cultural, education and scientific research centre.

Distinguished guests, my fellow citizens of Hong Kong:

In two years, the People's Republic of China will be celebrating its fiftieth birthday. In two years, the world will be greeting the beginning of a new millennium. And I know, in two years, Hong Kong will achieve greater successes and a better life for all, as we move into the next Century. Our nation will be proud of us.

I invite you to join me in wishing China thriving prosperity;

I invite you to join me in wishing Hong Kong continuous success.